Encana Corp will shift base to the United States and become Ovintiv Inc, the Canadian oil and gas producer said on Thursday, as Canada faces pipeline capacity shortages that have led many companies to move from the country’s energy sector.
Rivals Royal Dutch Shell , ConocoPhillips and Suncor Energy have either been selling their Canadian assets or have scaled back investments as pipeline space crunch impacts prices.
Encana meanwhile has been adding assets in the United States and had earlier this year bought Texas-based Newfield Exploration Co for $5.5 billion.
“A domicile in the United States will expose our company to increasingly larger pools of investment in U.S. index funds and passively managed accounts, as well as better align us with our U.S. peers,” Chief Executive Officer Doug Suttles said in a statement.
Encana said the rebranded company will continue to be dually traded on the Toronto and New York stock exchanges under the ticker symbol ‘OVV’.
Separately, the company said net income for the third quarter rose to $149 million, or 11 cents per share, from $39 million, or 4 cents, a year earlier. Operating profit rose to $195 million from $163 million.
Encana’s total production rose 4% on a proforma basis to 605,100 barrels of oil equivalent (BOE) per day in the quarter, on higher output from both its core Anadarko and Permian basins.
The company now expects higher annual production and lower costs than its earlier estimates, and kept its annual capital investment forecast unchanged at the mid-point of $2.8 billion.
Encana had earlier forecast full-year production to be between 290,000 and 310,000 barrels per day of liquids and 1,500 to 1,600 million cubic feet per day of natural gas.
(Reporting by Shariq Khan in Bengaluru and Nia Williams in Calgary; Editing by Bernard Orr and Arun Koyyur)